Uncertain outlook
The IMF warned the financial crisis remains acute. "The financial market stabilization will take longer than previously envisaged, even with strong efforts by policymakers," it said.
![IMF says global economy in 'severe recession' [CFP]](http://images.china.cn/attachement/jpg/site1007/20090423/00016c8b5de90b5a0c424e.jpg "IMF says global economy in 'severe recession' [CFP]") |
| IMF says global economy in 'severe recession' [CFP] |
Thus, financial strains in the mature markets are projected to remain heavy until well into 2010, and overall credit to the private sector in the advanced economies is expected to decline in both 2009 and 2010.
Meanwhile, emerging and developing economies are expected to face greatly curtailed access to external financing in both years.
In a semi-annual report Global Financial Stability Report (GFSR) , which was released on Monday, the IMF said write-down on US- originated assets to be suffered by all holders will be 2.7 trillion dollars, "largely as a result of the worsening base-case scenario for economic growth."
Total expected write-downs on global exposures are estimated at about 4 trillion dollars, of which two-thirds will fall on banks and the remainder on insurance companies, pension funds, hedge funds, and other intermediaries.
In the latest World Economic Outlook report, the IMF warned that the current outlook is exceptionally uncertain, with risks weighed to the downside.
The crisis has hurt international trade, with volume expected to plunge 11 percent this year before eking out 0.6 percent growth in 2010.
Consumer prices in developed countries were under pressure and would fall 0.2 percent in 2009.
"Even once the crisis is over, there will be a difficult transition period, with output growth appreciably below rates seen in the recent past," said the IMF.
